Firm Dynamics, On-the-Job Search and Labor Market Fluctuations

We devise a tractable model of firm dynamics with on-the-job search. The model admits analytical solutions for equilibrium outcomes, including quit, layoff, hiring and vacancy-filling rates, as well as the distributions of job values, a fundamental challenge posed by the environment. Optimal labor demand takes a novel form whereby hiring firms allow their marginal product to diffuse over an interval. The evolution of the marginal product over this interval endogenously exhibits gradual mean reversion, evoking a notion of imperfect labor market competition. This in turn contributes to dispersion in marginal products, giving rise to endogenous misallocation. Quantitatively, the model provides a parsimonious reconciliation of leading estimates of rent sharing, the negative association between wages and quits, the link between job and worker flows, and the cyclicality of labor market quantities and prices.

THE ROLE OF THE INTERACTIVE NOVEL IN MAKING THE DISCOURSE ON TOURISM

Travel literature is one of the narratives that the Arabs knew in the past, as it is a historical, geographic and visionary representation of others. The trip works on education. This is what the interactive text Ibn Battuta’s Journey to Dubai Al-Mahrousa by Muhammad Snagleh evokes in intertextuality with Ibn Battuta’s Journey, a Masterpiece of Overseers in the Oddities of the Regions and the Wonders of Travel by Ibn Battuta. If the latter travelled around the countries, the interactive text goes towards anticipating the future time in 2051, to read about the economic and political aspects in Dubai only. This research paper seeks to present a reading that combines the aesthetics of the interactive text with the tourist discourse. To what extent does interactive creativity contribute to the development of tourism? What are the possibilities offered by the blue screen for developing ancient narratives according to a modernist perspective? As for the curriculum, it is the systemic approach and interactive criticism. As so, the research is divided into two sections: 1 - The journey from paper to digital: Snagleh’s digital text consists of three units: the body text and its hyperlinks of a video, including images and sounds, and a pure interactive text for the reader's creativity and interactive participation in a two-track virtual journey. These are either directed to Ibn Battuta himself as a story and paper character, or send to the author of flesh and blood (i.e: Snagleh), editing the experience of the trip to Dubai or writing a comment or opinion. This is one of the suggested images of the interaction between the recipient and the text. 2. The Unsaid in the Discourse on Tourism: Snagleh diversified between spaces by highlighting its merits, and facilitating the means of transportation by air, sea and land. These options increase the persuasive power, and although Dubai is the glass civilization, Snagleh dazzles by showing the cultural coexistence between nationalities. However, he did not realize the overwhelming foreign presence among the natives. Thus, Snagleh’s novel can be counted as a cultural text, the implications of which can be read. Snagleh didn’t use Ibn Battuta as a paper figure as in Barthes’ terms, but as a sufficience. It is a strategic tourist guide, promoting Gulf tourism in Dubai by attracting the recipient with paintings and icons. Hence, literature is no longer a marginal product, but rather an economic industry that moves the wheel of sustainable development and increases its civilization incomes.

Efisiensi Alokatif Usahatani Nanas di Kecamatan Rasau Jaya Kabupaten Kubu Raya

Research on the allocative efficiency of pineapple farming in Rasau Jaya District is important because of the low production due to the minimal use of production input factors. Farmers can still increase pineapple production by using efficient production factors. The purpose of this study was to analyze the effect of the use of production factors and to analyze the level of allocative efficiency of pineapple farming in Rasau Jaya District. The data analysis used is the analysis of allocative efficiency and looks at the marginal product value of NPM / Px. The results of the regression analysis show that the use of TSP inputs has an effect on pineapple production in Kubu Raya Regency, while other variables have no effect. The level of allocative efficiency of pineapple farming in Rasau Jaya Subdistrict is inefficient for variable land area, urea, TSP, phonska, protepon and labor. Meanwhile, the inefficient variables were seeds, fertilizers and gramaxone.

Real Capital

Preshaped by the influence of Marx, Böhm-Bawerk and modern neoclassical economics, the general opinion is that the marginal product of capital must always be positive. With the help of the “period of production” T, we define a coefficient of intertemporal substitutionψ that is always non-negative. It can also be used when the real interest rate is negative. With the help of the concept of the “waiting period” Z, we can also define an always non-negative coefficient of intertemporal substitutionγ for the household side. The “loss formula” for deviations of the rate of interest from the growth rate is one application of ψ and γ. Ω = (ψT2 + γZ2)(r − g)2/2 provides a good approximation of the relative loss Ω. Overcomplexity of the system of production leads to negative marginal returns on capital. It can be empirically presumed that the OECD plus China region is on the cusp of overcomplexity. The hypothetical natural rate of interest in the eurozone is well into the minuses. To determine the value of the real capital of the private sector in the OECD plus China region, we use a framework of data taken from the World Inequality Database (WID.world). We have supplemented the data available there with data from other sources and adapted it to our theoretical objectives. According to our estimates, private wealth in the form of real capital in the OECD plus China region comes to approximately four times total annual consumption.

The efficiency of pig farming inputs in Minahasa Regency of North Sulawesi

The purpose of this study was to analyze the factors influencing the production and the efficiency of pig farming input in Minahasa Regency of North Sulawesi Province. The location was determined using the multistage random sampling method, determining regency, districts, and village, which have the highest pig population in North Sulawesi Province, so that Minahasa Regency, and four selected Districts (Sonder, Kakas, Tombulu and Tombariri), then 2 villages/district were taken. The sample was determined using a simple random method by taking 25 farmers in each district so that the total sample was 100 pig farmers, then the data was taken in January-July 2019. Variables measured were the number of pig production, the number of sows, the number of piglets, the number of feed (corn, concentrate, rice bran) and the number of labor. Data were analyzed using the Cobb-Douglas production function model with multiple linear regression and marginal product values calculations. The results showed that the efficiency of pig farming inputs was larger than one, meaning it was inefficient. This condition is still possible to increase pig production by increasing the number of sows, the number of piglets, the number of feed (corn, bran, concentrate), and the number of labor.

The Return on Information Technology: Who Benefits Most?

Information and communication technology (ICT) has continuously reshaped the way in which businesses operate. Yet opinions among economists about the returns to ICT, especially at the aggregate level, are divided. We exploit business-to-business transaction panel data from ICT producers to construct ICT capital stocks for a large sample of Belgian firms. This allows us to estimate the returns to ICT at the firm level and to investigate how firm-level ICT investments affected aggregate gross domestic product and productivity. We find large returns to ICT—more precisely, a firm investing an additional euro in ICT—increases value added by 1 euro and 35 cents on average. This marginal product of ICT investment increases with firm size and varies across sectors. Although we find substantial returns to ICT at the firm level, returns are much lower at the aggregate level. This is due to underinvestment in ICT (ICT capital deepening is low) and because firms with especially high returns are underinvesting.

The Rise of Services and Balanced Growth in Theory and Data

We investigate the effect of structural transformation on the process of economic growth. Using a two-sector growth model we show that, in addition to Baumol’s cost disease, structural transformation from goods to services generates other predictions that are in line with cross-country growth facts: an increase in the real investment rate, a decline in the real interest rate and the marginal product of capital, and an acceleration of investment-specific technological change as the share of services increases. The model calibrated to US data can account for the elasticity of real investment rates to the share of services measured in cross-country data. (JEL E22, E23, E43, L16, O33, O41, O47)

Estimating a non-neutral production function

In this article we estimate a production function that allows us to depart from the standard hypothesis of Hicks neutrality (HN) while also coping with the endogeneity of a dummy innovation variable. We consider specifications that relax HN, and we derive the testable conditions for common parametric approximations under which HN holds. The model is estimated using instrumental variable methods, allowing innovation to have a heterogeneous effect on the production process. The econometric analysis rejects HN and highlights three main features: a biased technical change (TC), with a higher ratio between the marginal product of labour and the marginal product of capital for innovative firms; a locally progressive TC; fully heterogeneous technologies when comparing innovative to non-innovative firms. We also address other issues, taking a closer look at the effect of process innovation and the role of sector heterogeneity and considering the potential endogeneity of labour input.

Lucas Paradox, Declining Labor Share, Tendency of Rate of Profit to Fall of Karl Marx and Growth Theory of the Firm

Macroeconomic phenomena we observe are supposed to be analogous to conclusions derived from microeconomic models because macroeconomic phenomena are aggregation of data coming from microeconomic events. Since the firm plays the central role to produce output, I use growth theory of the firm to predict macroeconomic phenomena as below. First, the law of diminishing marginal product does not operate although marginal product derived from production function diminishes because the firm increases supply of output by scale growth without change in capital-labor ratio, not by change in capital-labor ratio under fixed scale. Thus, profit rate of rich (capital abundant) country is unnecessarily less than poor (labor abundant) country due to the law of diminishing marginal product so that capital does not outflow from rich country to poor country. Lucas’ paradox is solved. Second, labor share is equal to capital share in the long run if capital and labor can substitute each other perfectly because the optimal capital-labor ratio of the firm is equal to the ratio of wage rate to return rate on capital, K⁄N=w⁄γ. That is, labor is relatively more expensive (less productive) than capital if labor share is greater than 50 percent. Since labor share has been higher than 50 percent of GDP (i.e., there is room to substitute capital for labor) for centuries, growth theory of the firm explains the long term trend of declining labor share. Third, labor share is countercyclical and capital share is cyclical in the short run because the amplitude of investment and profit fluctuation is greater than employment and wage. Fourth, the production function that the firm uses to produce is increasing return to scale, which implies not only cyclical co-movement of investment, employment, productivity and factor prices domestically but also unbalanced trade and factor price differentiation internationally. Fifth, diminishing marginal revenue makes wage growth rate less than growth rate of labor productivity and growth rate of return rate on capital less than growth rate of capital productivity. Sixth, growth theory of the firm asserts principle of acceleration in macroeconomics. Seventh, profit rate rises when GDP grows. Thus, tendency of rate of profit to fall predicted by Karl Marx is wrong. In appendix, I propose to statistically approximate the true production function in real world by Taylor series because production functions economists have ever proposed (e.g., Cobb-Douglas) are not proved to be true by economists.